Consider the teddy bear. Cute. Cuddly. Fun for toddlers. And in the case of the one on the left, a little naughty.
Is there a market for a good teddy bear? Sure there is. Now consider a teddy bear brand associated with one of the smallest states in the union and marketed exclusively to men. That's less than a niche. That's like a tiny notch in a niche. Can you imagine walking into a bank with a business plan for a product like that?
I'm describing, of course, the original business model for Vermont Teddy Bear, a great example of a narrow-niche business, and a relevant case study for anyone entering the hopelessly cluttered ecommerce realm.
John Sortino had been making and selling teddy bears in Burlington Vermont for nearly ten years. And he was doing okay with it, until 1990, when he went to New York with an unusual marketing strategy-- radio ads targeting guys who needed a great, unique gift just before Valentine's Day-- a Bear-Gram as they called it. Teddy Bear ads targeting guys? It was crazy. It also killed. his fledgling company made its sales goals for the entire year in just two days, and a marketing sensation was born.
Vermont Teddy Bear built its success with only one target customer in mind-- the panicked male desperate to get a gift at the last minute for a loved one-- and they offered him one, simple, unique product. They focused the marketing on direct response radio that hit the most relevant outlets for reaching this specific type of guy. Talk radio, sports, that sort of thing. It was certainly the only Teddy Bear being advertised among the sea of steak houses and "buy gold" blather that typically sponsors dude-focused radio.
That was then. Today, they're selling more than 350,000 bears a year and have launched the highly-successful sister brand Pajama-Gram, which also narrowly focuses a simple product on a very specific target.
Vermont Teddy Bear didn't make its lot trying to be all things to all people. Rather, it focused on being a specific thing to a specific person. And in today's digital world, it's possible to find success being more specific than ever. But the web is awash with startups trying to rule the world, to sell everything to everyone, or to create the next social networking behemoth.
So let me say this as clearly as I can. You are not going to be the next Amazon. You are not going to be the next Facebook. The venture capital gods are not going to summon you to Menlo Park and hand you the keys because you have a site that does and sells the same junk that ten thousand other sites do and sell. The web is littered with the hollowed out corpses of these sorts of startups. And it's a shame, because the web is also littered with tons and tons of opportunity.
The real opportunity is in the narrow-niche. Why? Because the deeper your potential customer pool, the narrower your niche can be. John Sortino would never have grown Vermont Teddy Bear just selling to frantic husbands in Burlington. He needed access to a deeper pool of these guys. Likewise, you can take a very specific product offering and, with a smart SEM campaign and a well-optimized site, find a very deep pool of customers as well. Here are the markings of a great narrow-niche business:
It's instantly distinctive.
It should be clear from the moment someone encounters your product that there's nothing else out there like it. It's got a hook, a story, a promise, a something that sets it apart from the get-go. Don't try to create a "me-to" product that'll put you head-to-head with bigger, more well-funded competitor. Instead, offer something different enough that the competition ignores it entirely (even as the customers come through the door).
It's not for everybody.
Vermont Teddy Bear owns the concept of the Teddy Bear made in Vermont.
To many people, that means nothing, but to the right people, it means
everything. A great narrow-niche business will succeed by being
something very special to a specific audience, and screw the rest of
the world.
Nobody else is selling it.
Much of the ecommerce world is focused these days on selling the same stuff through different channels. It's a bit like opening up a stereo store in a mall next to a dozen other stereo stores and hoping for the best. If you see a dozen stereo stores in a row, try opening a store that sells earplugs.
It's cheap to SEM.
The more unique and distinctive your product, the cheaper it is to create a robust, relevant search campaign for it. Selling hot sauce out of your apartment in Taos, New Mexico? Don't buy "hot sauce" as a search phrase. Buy "New Mexico hot sauce" or "Taos hot sauce" or "green chile hot sauce." It'll cost you less, and the people you land will be that much more relevant to your business.
It's got a soul. Namely yours.
TGI Friday's has no soul. But Potbelly's? That place has a soul. And it comes from being proud and standing tall with regards to who you are and what you offer. Things that have soul come from real people who put real love and passion into the things they create. This is my hot sauce. This is my design firm. This is my teddy bear. And it's okay when someone doesn't want what you offer. Whether online or in line at lunch, this is just as true. Create something simple, genuine, and unique. Something your proud of. Something that stirs the emotions of others. If you can do that, you've found your niche.
Stumble It!

